The Markets (as of market close ​​​​​​January 10, 2020)

Last Friday's jobs report was a mixed bag of information. While 145,000 new jobs were added and the unemployment rate remained at 3.5%, wage growth was tepid in December to cap off a year of only moderate wage growth. This information, coupled with news that the Senate would receive the articles of impeachment this week, culled what was otherwise a strong week for stocks. The Dow passed 29000 earlier last week only to pull back by week's end. In any case, most of the indexes listed here posted gains last week, except for the small caps of the Russell 2000, which has gotten off to a relatively slow start in 2020. Conversely, the tech-heavy Nasdaq continues to post strong returns, climbing 1.75% last week and 2.30% ahead of its 2019 closing value.

Oil prices plummeted last week, closing at $59.14 per barrel by late Friday afternoon, down from the prior week's price of $63.05. The price of gold (COMEX) rose higher again last week, closing at $1,561.60 by late Friday afternoon, up from the prior week's price of $1,553.30. The national average retail regular gasoline price was $2.578 per gallon on January 6, 2020, $0.007 more than the prior week's price and $0.341 more than a year ago.

Market/Index

2019 Close

Prior Week

As of ​1/10

Weekly Change

YTD Change

DJIA

28538.44

28634.88

28823.77

0.66%

​​​1.00%

Nasdaq

8972.60

9020.77

9178.86

1.75%

​​2.30%

S&P 500

3230.78

3234.85

3265.35

​0.94%

​1.07%

Russell 2000

3251.24

1​660.87

1​​657.64

​-0.19%

​​-0.65%

Global Dow

2736.74

3258.76

3260.65

0.06%

0.29%

Fed. Funds target rate

1.25%​–1.75%

1.50%​–1.75%

1.​50%​–1.75%

​0 bps

0 bps

10-year Treasuries

1.91%

1.78%

1.82%

4 bps

-​​​​9 bps

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week's Economic Headlines

  • There were 5.8 million unemployed persons in December, and the unemployment rate remained at 3.5%. A year earlier, the unemployment rate was 3.9% based on 6.3 million unemployed persons. The labor force participation rate was unchanged at 63.2% in December. The employment-population ratio was 61.0% for the fourth consecutive month but was up by 0.4 percentage point over the year. There were 145,000 new jobs added in December. Notable job gains occurred in retail trade and health care, while mining lost jobs. In 2019, employment rose by 2.1 million, down from a gain of 2.7 million in 2018. The average workweek was unchanged at 34.3 hours in December. Average hourly earnings rose by $0.03 to $28.32 last month. Over the last 12 months, average hourly earnings have increased by 2.9%.
  • In the latest report from the Census Bureau, the goods and services trade deficit for November was $43.1 billion, down $3.9 billion from October's deficit of $46.9 billion, revised. November exports were $208.6 billion, $1.4 billion more than October exports. November imports were $251.7 billion, $2.5 billion less than October imports. Year-to-date, the goods and services deficit decreased $3.9 billion, or 0.7%, from the same period in 2018. Exports decreased less than $0.1 billion, or less than 0.1%. Imports decreased $3.9 billion, or 0.1%.
  • According to the latest Non-Manufacturing ISM® Report On Business®, the December non-manufacturing index was 55%, 1.1 percentage points higher than the November reading. In the services sector, survey respondents saw an uptick in prices and business activity. However, new orders and employment dropped in December from the prior month.
  • For the week ended January 4, there were 214,000 claims for unemployment insurance, a decrease of 9,000 from the previous week's level, which was revised up by 1,000. According to the Department of Labor, the advance rate for insured unemployment claims remained at 1.2% for the week ended December 28. The advance number of those receiving unemployment insurance benefits during the week ended December 28 was 1,803,000, an increase of 75,000 from the prior week's level.

Eye on the Week Ahead

This is a busy week for market-influencing economic reports, starting with the Treasury budget report for December. The government deficit has been expanding, reaching close to $1 trillion. The latest information on inflationary trends is also out with reports on consumer and producer prices. The Federal Reserve's report on industrial production is also out at the end of the week. If surveys of purchasing managers are any indication, the Fed's report on industrial production will show continued weakness in December.

Data sources: News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. Market data: Based on data reported in WSJ Market Data Center (indexes); U.S. Treasury (Treasury yields); U.S. Energy Information Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing, OK); www.goldprice.org (spot gold/silver); Oanda/FX Street (currency exchange rates). All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful. 

The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2,000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. Market indices listed are unmanaged and are not available for direct investment.


The Markets (as of market close ​​​​​​January 3, 2020)

A strong start last week for the benchmark indexes listed here was wiped out by rising tensions in the Middle East. Only the Nasdaq was able to close slightly higher last week as the other benchmark indexes listed here closed the week in the red. Both the Dow and S&P 500 lost value, as did the Global Dow. The small caps of the Russell 2000 had the worst week-over-week performance, falling about 0.50%. On the other hand, oil, gold, and 10-year Treasuries pushed higher last week. 

Oil prices inched higher last week, closing at $59.82 per barrel by late Friday afternoon, up from the prior week's price of $59.12. The price of gold (COMEX) climbed last week, closing at $1,480.20 by late Friday afternoon, up from the prior week's price of $1,464.50. The national average retail regular gasoline price was $2.561 per gallon on December 9, 2019, $0.014 less than the prior week's price but $0.140 more than a year ago.

Market/Index

2019 Close

Prior Week

As of ​1/3

Weekly Change

YTD Change

DJIA

28538.44

28645.26

28634.88

-0.04%

​​​0.34%

Nasdaq

8972.60

9006.62

9020.77

0.16%

​​0.54%

S&P 500

3230.78

3240.02

3234.85

​-0.16%

​0.13%

Russell 2000

3251.24

1​669.03

1​​660.87

​-0.49%

​​-0.46%

Global Dow

2736.74

3265.24

3258.76

-0.20%

0.23%

Fed. Funds target rate

1.25%​–1.75%

1.50%​–1.75%

1.​50%​–1.75%

​0 bps

0 bps

10-year Treasuries

1.91%

1.87%

1.78%

-9 bps

-​​​​13 bps

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week's Economic Headlines

  • The international trade deficit came in at a three-year low in November at $63.2 billion, down $3.6 billion from the $66.8 billion deficit in October. Exports of goods for November were $136.4 billion, $0.9 billion more than October exports. Imports of goods for November were $199.6 billion, $2.7 billion less than October imports.
  • Purchasing managers remained guarded in their assessment of the manufacturing sector in December. According to the latest report from Markit, the IHS Markit final U.S. Manufacturing Purchasing Managers' Index™ (PMI™) posted 52.4 in December, down slightly from 52.6 in November. IHS Markit Chief Business Economist Chris Williamson indicated that, while manufacturing continues to recover from a weak summer, overall expansion in that sector remains well below that seen this time last year. Williamson also noted that the impact of tariffs has pushed prices higher, softened business confidence, and curtailed hiring.
  • Purchasing manager respondents to the Institute for Supply Management survey were more reticent about the manufacturing sector than those who responded to the Markit survey. According to the December ISM® report, manufacturing contracted last month as the purchasing managers index registered 47.2%, 0.9 percentage point below November's reading. December's decline marks the fifth straight month of contraction in the manufacturing sector. In addition, new orders, supplier deliveries, new export orders, employment, and production contracted in December. Only imports, prices, and backlog of orders expanded last month.
  • For the week ended December 28, there were 222,000 claims for unemployment insurance, a decrease of 2,000 from the previous week's level, which was revised up by 2,000. According to the Department of Labor, the advance rate for insured unemployment claims remained at 1.2% for the week ended December 21. The advance number of those receiving unemployment insurance benefits during the week ended December 21 was 1,728,000, an increase of 5,000 from the prior week's level, which was revised up by 4,000.

Eye on the Week Ahead

The major economic report out this week covers December's employment figures. This report will cap off a solid year for job hirings, although wage growth has been moderate. Also, the trade report for November is available this week. The trade deficit was over $47 billion in October, and has been narrowing over the past few months. Year-to-date (through October 2019), however, the trade deficit has increased by $6.9 billion, or 1.3% from the same period in 2018.

Data sources: News items are based on reports from multiple commonly available international news sources (i.e. wire services) and are independently verified when necessary with secondary sources such as government agencies, corporate press releases, or trade organizations. Market data: Based on data reported in WSJ Market Data Center (indexes); U.S. Treasury (Treasury yields); U.S. Energy Information Administration/Bloomberg.com Market Data (oil spot price, WTI Cushing, OK); www.goldprice.org (spot gold/silver); Oanda/FX Street (currency exchange rates). All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results. All investing involves risk, including the potential loss of principal, and there can be no guarantee that any investing strategy will be successful. 

The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2,000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. Market indices listed are unmanaged and are not available for direct investment.